What is the ideal pension product for each stage of life?
Each stage of life has its own forecasting needs. We live exposed to many risks that could affect our assets and our physical integrity. When we are young and have other people in charge, the immediate need is to ensure their well-being if we are absent. When our children are older and less dependent, we must save to plan our own retirement.
Dedicating a few minutes to correctly analyze our needs and the risks to which we are exposed is a necessary step to be able to carry out good financial planning that allows us to live more peacefully.
What attitudes can we take in relation to risk?
1.- That happens to others, not to me.
It is indifference, living carelessly or irresponsibly without properly assessing the risk and without establishing any preventive measures. This attitude can lead us to a real situation of helplessness or precariousness: the disability or death of one of the spouses can economically destabilize the family home
2.- I will save a little each month just in case.
Thinking that saving part of our monthly income is enough to face unforeseen events may seem like a good idea, but:
How to be sure it won’t happen while I’m still saving?
Will the amount I have saved be enough?
Will I be able to save for contingencies and for retirement at the same time?
3.- I have significant assets. I am already covered.
If we make correct calculations, it is possible that the support of our assets makes us think that we do not need to take out Erie Insurance. However, the liquidity of this heritage must be taken into account to meet day-to-day expenses, the payment of debts, inheritance expenses in the event of death, the cost of care in the event of disability, etc.
Am I sure of obtaining immediate liquidity in the event of death or disability?
Will the need influence the sale price?
4.- Make sure.
Life Insurance is the only product that guarantees, from the first day it is contracted, the necessary economic security in the event of the death of the insured. In addition, supplementary disability insurance also protects our loved ones and us from this contingency.
Traditional Life-Savings insurance will allow us to face various stages with ease. University studies, retirement, or dependency will be duly covered if we have carried out correct planning throughout life.
In short, insurance allows us to live life with more confidence.
Main vital milestones and their insurance
Access to the world of work marks the beginning of our economic independence and usually leads us to our first contact with the financial world, we buy a car, we furnish our first rental apartment, and we even consider buying a house.
Being single and unencumbered does not exempt us from covering those debts in case of unforeseen events, so our parents or siblings can receive our assets free of charge, at a negligible cost to us.
The creation of a family:
Our priorities have changed, and comprehensive protection is beginning to concern us and finding the perfect match for us with a product that combines coverage for death, disability, and long-term savings? And that it also allows the covered capital to be increased or decreased in the event of death depending on the needs at any given time? Yes, it is possible.
Think about the formation of children:
Who does not want to be able to offer the best opportunities to their children? With good planning, it is possible to ensure a significant guaranteed capital on a certain date, even if the premiums have stopped being paid due to the death of the insured.
A capital that will allow access to quality education, help them to start their own savings, or the push they need to launch their business idea.
Prepare for retirement:
From the age of 40, it is vital to become aware and begin to constitute the capital that will complement the public retirement pension.
Planning is advised by professionals, who will guide us and inform us about the tax treatment of the different options and the insured capital that we must establish based on our personal circumstances, sources of income, available assets, outstanding debts, savings capacity, retirement pension expected, etc. With the appropriate coverage according to our family welfare needs.
Although we have a risky investor profile, we must always insure with guaranteed products such as life insurance, a vital minimum that allows us to face retirement with dignity if the rest of our investments go wrong.
We have taken care of all the details; likely, we do not have important debts, and our children have been emancipated, now we have to take care of ourselves, and insurance with dependency coverage is the perfect tool for this.
The advantageous tax treatment and an operation designed to save and at the same time guarantee a life annuity in the event of disability and/or dependency makes this product a good ally and an effective instrument for complementary social security.
Have retirement savings:
When the moment of retirement arrives and depending on the choices we have been making throughout our working life, we will obtain the fruit of good planning by enjoying Income, Guaranteed Capital, or a combination of both, which will allow us to maintain our standard of living prior to retirement for many years.
Planning financially for the entire life cycle, with a view to covering contingencies that occur at mature and advanced ages, will allow us to have an adequate complement to the public pension that will influence our well-being and that of everyone.
For this planning, we can rely on the products managed through insurance companies, experts both in longevity management and in optimizing investments in long and very long-term (more profitable) safe assets, which allows them to offer specific products to its policyholders with reinforced guarantees also in the current scenario of reduced returns.